World's Central Banks Team Up to Boost Sagging Markets
US Federal Reserve says it will auction up to $180 billion to markets in coordinated action with central banks in Canada, Britian, Japan, Switzerland, European Central Bank.
The world's biggest central banks are joining forces to keep the global economy afloat, as the fallout continues over the worsening U.S. economy.
The U.S. Federal Reserve says it will auction up to $180 billion to the markets in a coordinated action with central banks in Canada, Britian, Japan, Switzerland, and the European Central Bank.
The move comes as share prices on Asian stock markets are plunging Thursday. Tokyo's Nikkei index closed more than two percent lower, while Hong Kong's Hang Seng index was flat, losing just five points at the close. The index was down by as much as seven percent in early afternoon trading.
The turmoil is also affecting oil prices, with trading for light crude oil dropping to $96 a barrel in Singapore.
The Bush administration's $85 billion emergency loan Wednesday to bail out the world's biggest insurance company, American International Group, AIG, was not enough to keep major stock indexes from falling.
The U.S. central bank authorized the loan late Tuesday to prevent a "disorderly failure" of AIG that could make troubled financial markets worse.
AIG nearly collapsed after major losses in the housing crisis.
Another institution plagued by mortgage losses, Washington Mutual, is reported to have put itself up for sale. News reports late Wednesday said potential buyers of the Seattle-based bank include Citigroup and Wells Fargo.
And London-based Lloyds TSB has reached a deal to buy Halifax Bank of Scotland, HBOS, for nearly $22 billion. Shares of HBOS have plummeted in recent days.
The White House says President Bush is canceling a planned trip to Alabama and Florida Thursday to consult with his economic advisors on the crisis on Wall Street.
Some information for this report was provided by AP, AFP and Reuters